Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Event-Driven

The Korea Exchange (KRX) will announce the results of the December 2020 review of the <a href="https://www.smartkarma.com/entities/korea-stock-exchange-kospi-200-index" target="_blank" data-smartkarma-citation="entities:26021:1" rel="noopener">Korea Stock Exchange Kospi 200 Index (KOSPI2 INDEX)</a> in November. The constituent changes will be effective from the open on 11 December 2020 and the rebalancing trades will need to be done at the closing auction on 10 December 2020.At the current time, we see nine stocks being added to and deleted from the index with another three stocks as very close adds and deletes. There could be an additional change with <a href="https://www.smartkarma.com/entities/big-hit-entertainment" target="_blank" data-smartkarma-citation="entities:28959:1" rel="noopener">Big Hit Entertainment (352820 KS)</a> getting index inclusion as a Fast Entry - this change could be announced ahead of the regular review announcement or as a part of the regular announcement, though the implementation will be at the same time as the December review.The potential inclusions have outperformed the potential exclusions by a wide margin over the last 6 months though the performance has been subdued over the last 2 months. With the short sell ban still in force, we could see the potential inclusions continue to outperform the potential exclusions after this period of consolidation, especially once the announcement of the changes has been made.In the Insight, we look at the expected changes, the impact of the changes on the stocks, the performance of the stocks and the short interest, the behaviour of the inclusions/exclusions at the June review and recommend some trades going forward.

The Korea Exchange (KRX) will announce the results of the December 2020 review of the Korea Stock Exchange Kospi 200 Index (KOSPI2 INDEX) in November. The constituent changes will be effective from the open on 11 December 2020 and the rebalancing trades will need to be done at the closing auction on 10 December 2020.At the current time, we see nine stocks being added to and deleted from the index with another three stocks as very close adds and deletes. There could be an additional change with Big Hit Entertainment (352820 KS) getting index inclusion as a Fast Entry - this change could be announced ahead of the regular review announcement or as a part of the regular announcement, though the implementation will be at the same time as the December review.The potential inclusions have outperformed the potential exclusions by a wide margin over the last 6 months though the performance has been subdued over the last 2 months. With the short sell ban still in force, we could see the potential inclusions continue to outperform the potential exclusions after this period of consolidation, especially once the announcement of the changes has been made.In the Insight, we look at the expected changes, the impact of the changes on the stocks, the performance of the stocks and the short interest, the behaviour of the inclusions/exclusions at the June review and recommend some trades going forward.

KOSPI200 Index Rebalance Preview: Review Period Nearly Complete, Nine (Or Ten) Possible Changes

Korea / Special Sits, Pairs, Index Rebalancing, Clepsydra Capital

Sanghyun Park

Korea / Special Sits, Pairs, Index Rebalancing

Equity Capital Markets

Doosan Fuel Cell   / Equity Capital Markets

The major shareholder put up a total of 19.7% stake in block deals.But only half of the target went through despite a hefty discount. That is, 5.6M shares out of 10.9M found buyers. 4M went to overseas institutions, and the remaining 1.6M found local investors.The offering price was fixed at the lower end of the suggested price band (₩35,465), so the final discount was 18% to the previous closing price.The major shareholder is now left with 5.3M shares (9.6%).<table class="table table-striped">
<colgroup>
<col width="300">
<col width="300">
</colgroup>
<tbody>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Overview"}'>Block deal terms &amp; outcome</td></tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Date"}'>Date</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44109}' data-sheets-numberformat='{"1":5,"2":"mmmm d, yyyy","3":1}'>October 5, 2020</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Target"}'>Target</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Doosan Fuel Cell Co Ltd"}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}' data-sheets-formula='=googlefinance(R[1]C[0], "name")'>Doosan Fuel Cell Co Ltd</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Ticker"}'>Ticker</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"336260"}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}' data-sheets-formula='="336260"'>336260</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Seller"}'>Seller</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"The major shareholder"}'>The major shareholder</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Offer size"}'>Offer size</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":10927270}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>10,927,270</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - % of SO"}'>- % of SO</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.19691000744840959}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula='=R[-1]C[0]/googlefinance(R[-3]C[0], "shares")'>19.69%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Value"}'>Value (₩B)</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":387.53563055}' data-sheets-numberformat='{"1":2,"2":"[$₩-412]#,##0","3":1}' data-sheets-formula="=R[-2]C[0]*R[4]C[0]/1000000000">387.5</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Last close"}'>Last close</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":43250}' data-sheets-numberformat='{"1":2,"2":"[$₩-412]#,##0","3":1}'>₩43,250</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Indicative price - ceiling"}'>Indicative price - ceiling</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":37628}' data-sheets-numberformat='{"1":2,"2":"[$₩-412]#,##0","3":1}'>₩37,628</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - % to last close"}'>- % to the last close</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.1299884393063584}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=(R[-2]C[0]-R[-1]C[0])/R[-2]C[0]">13.00%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Indicative price - Floor"}'>Indicative price - Floor</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":35465}' data-sheets-numberformat='{"1":2,"2":"[$₩-412]#,##0","3":1}'>₩35,465</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - % to last close"}'>- % to the last close</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.18}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=(R[-4]C[0]-R[-1]C[0])/R[-4]C[0]">18.00%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Final price"}'>Final price</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":35465}' data-sheets-numberformat='{"1":2,"2":"[$₩-412]#,##0","3":1}'>₩35,465</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Final quantity (sold)"}'>Final quantity (sold)</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":5600000}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>5,600,000</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Overseas"}'>- Overseas</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":4000000}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>4,000,000</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Local"}'>- Local</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":1600000}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=R[-2]C[0]-R[-1]C[0]"> 1,600,000</td>
</tr>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Source: Hankyung &amp; FnGuide"}'>Source: Hankyung &amp; FnGuide</td></tr>
</tbody>
</table>

The major shareholder put up a total of 19.7% stake in block deals.But only half of the target went through despite a hefty discount. That is, 5.6M shares out of 10.9M found buyers. 4M went to overseas institutions, and the remaining 1.6M found local investors.The offering price was fixed at the lower end of the suggested price band (₩35,465), so the final discount was 18% to the previous closing price.The major shareholder is now left with 5.3M shares (9.6%).





Block deal terms &amp; outcome

Date
October 5, 2020


Target
Doosan Fuel Cell Co Ltd


Ticker
336260


Seller
The major shareholder


Offer size
10,927,270


- % of SO
19.69%


Value (₩B)
387.5


Last close
₩43,250


Indicative price - ceiling
₩37,628


- % to the last close
13.00%


Indicative price - Floor
₩35,465


- % to the last close
18.00%


Final price
₩35,465


Final quantity (sold)
5,600,000


- Overseas
4,000,000


- Local
 1,600,000

Source: Hankyung &amp; FnGuide



Doosan Fuelcell: Block Deals Outcome on Rights Offer

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

It was announced after the market close today that <a href="https://www.smartkarma.com/entities/doosan-fuel-cell-co-ltd" target="_blank" data-smartkarma-citation="entities:29252:1" rel="noopener">Doosan Fuel Cell Co Ltd (336260 KS)</a> will conduct a big block deal of 10.927 million shares. Doosan Fuel Cell currently has 55.493 million shares so the block deal would represent <a href="https://finance.naver.com/news/news_read.nhn?article_id=0004426670&amp;office_id=015&amp;mode=LSS2D&amp;type=0&amp;section_id=101&amp;section_id2=258&amp;section_id3=&amp;date=20201005&amp;page=1" target="_blank" rel="noopener">19.7%</a> of total shares outstanding. About 10 major shareholders (including Doosan Corp, Doosan Group Chairman Park Jung-Won, and Doosan Heavy Industries Chairman Park Ji-Won) are selling part of their shares in this block deal. <div class="content-highlight">
We would take this block deal due to the following three main reasons:
1) Big discount&amp; reduced valuations
2) A leading, profitable player in the fuel cell industry in Korea
3) Inclusion in BBIG and Korean New Deal Funds
</div>

It was announced after the market close today that Doosan Fuel Cell Co Ltd (336260 KS) will conduct a big block deal of 10.927 million shares. Doosan Fuel Cell currently has 55.493 million shares so the block deal would represent 19.7% of total shares outstanding. About 10 major shareholders (including Doosan Corp, Doosan Group Chairman Park Jung-Won, and Doosan Heavy Industries Chairman Park Ji-Won) are selling part of their shares in this block deal. 
We would take this block deal due to the following three main reasons:
1) Big discount&amp; reduced valuations
2) A leading, profitable player in the fuel cell industry in Korea
3) Inclusion in BBIG and Korean New Deal Funds


Doosan Fuel Cell Big Block Deal Placement

KOSPI 200 biannual rebalancing is coming. This year, it will be December 11, 2020.It will be the first time that the KRX does a KOSPI 200 rebalancing biannually in December.Due to the current market condition (high fluctuations), we will likely see a higher number of changes than usual.<table class="table table-striped">
<colgroup>
<col width="200">
<col width="200">
</colgroup>
<tbody>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Status"}'>Status</td></tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Index"}'>Index</td>
<td style="text-align: right;" data-sheets-formula='=googlefinance(R[1]C[0], "name")' data-sheets-numberformat='{"1":5,"2":"mmmm d, yyyy","3":1}' data-sheets-value='{"1":2,"2":"KOSPI 200 Index"}'>KOSPI 200 Index</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Ticker"}'>Ticker</td>
<td style="text-align: right;" data-sheets-formula='="KRX:KOSPI200"' data-sheets-numberformat='{"1":5,"2":"mmmm d, yyyy","3":1}' data-sheets-value='{"1":2,"2":"KRX:KOSPI200"}'>KOSPI200</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Date"}'>Date</td>
<td style="text-align: right;" data-sheets-numberformat='{"1":5,"2":"mmmm d, yyyy","3":1}' data-sheets-value='{"1":3,"3":44099}'>September 25, 2020</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Rebalancing"}'>Rebalancing</td>
<td style="text-align: right;" data-sheets-numberformat='{"1":2,"2":"#,##0"}' data-sheets-value='{"1":2,"2":"Biannually"}'>Biannually</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Effective date"}'>- Effective date</td>
<td style="text-align: right;" data-sheets-numberformat='{"1":2,"2":"#,##0"}' data-sheets-value='{"1":2,"2":"Next trading day of 2nd Thursday of June &amp; December"}'>Next trading day of 2nd Thursday of June &amp; December</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - June"}'>- June</td>
<td style="text-align: right;" data-sheets-numberformat='{"1":5,"2":"mmmm d, yyyy","3":1}' data-sheets-value='{"1":3,"3":43994}'>June 12, 2020</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - December"}'>- December</td>
<td style="text-align: right;" data-sheets-numberformat='{"1":5,"2":"mmmm d, yyyy","3":1}' data-sheets-value='{"1":3,"3":44176}'>December 11, 2020</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Number of constituents"}'>Number of constituents</td>
<td style="text-align: right;" data-sheets-numberformat='{"1":2,"2":"#,##0"}' data-sheets-value='{"1":3,"3":200}'>200</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Est. total mirroring funds"}'>Est. total mirroring funds</td>
<td style="text-align: right;" data-sheets-numberformat='{"1":2,"2":"#,##0.0"}' data-sheets-value='{"1":3,"3":60000}'>60,000.0</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Total float MC"}'>Total float MC</td>
<td style="text-align: right;" data-sheets-numberformat='{"1":2,"2":"#,##0.0"}' data-sheets-value='{"1":3,"3":884235.718}'>884,235.7</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Average"}'>- Average</td>
<td style="text-align: right;" data-sheets-numberformat='{"1":2,"2":"#,##0.0"}' data-sheets-value='{"1":3,"3":4421.179}'>4,421.2</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Highest"}'>- Highest</td>
<td style="text-align: right;" data-sheets-numberformat='{"1":2,"2":"#,##0.0"}' data-sheets-value='{"1":3,"3":273063.808}'>273,063.8</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Lowest"}'>- Lowest</td>
<td style="text-align: right;" data-sheets-numberformat='{"1":2,"2":"#,##0.0"}' data-sheets-value='{"1":3,"3":62.926}'>62.9</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Median"}'>- Median</td>
<td style="text-align: right;" data-sheets-numberformat='{"1":2,"2":"#,##0.0"}' data-sheets-value='{"1":3,"3":1023.081}'>1,023.1</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Top 10 largest"}'>- Top 10 largest</td>
<td style="text-align: right;" data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-value='{"1":3,"3":0.5753}'>57.53%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Current"}'>Current</td>
<td style="text-align: right;" data-sheets-formula='=googlefinance(R[-14]C[0], "price")' data-sheets-numberformat='{"1":2,"2":"#,##0.00","3":1}' data-sheets-value='{"1":3,"3":303.57}'>303.57</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"52W high (September 15, 2020)"}'>52W high (September 15, 2020)</td>
<td style="text-align: right;" data-sheets-numberformat='{"1":2,"2":"#,##0.00","3":1}' data-sheets-value='{"1":3,"3":323.36}'>323.36</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"52W low (March 19, 2020)"}'>52W low (March 19, 2020)</td>
<td style="text-align: right;" data-sheets-numberformat='{"1":2,"2":"#,##0.00","3":1}' data-sheets-value='{"1":3,"3":199.28}'>199.28</td>
</tr>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Source: KRX"}'>Source: KRX</td></tr>
</tbody>
</table>

KOSPI 200 biannual rebalancing is coming. This year, it will be December 11, 2020.It will be the first time that the KRX does a KOSPI 200 rebalancing biannually in December.Due to the current market condition (high fluctuations), we will likely see a higher number of changes than usual.





Status

Index
KOSPI 200 Index


Ticker
KOSPI200


Date
September 25, 2020


Rebalancing
Biannually


- Effective date
Next trading day of 2nd Thursday of June &amp; December


- June
June 12, 2020


- December
December 11, 2020


Number of constituents
200


Est. total mirroring funds
60,000.0


Total float MC
884,235.7


- Average
4,421.2


- Highest
273,063.8


- Lowest
62.9


- Median
1,023.1


- Top 10 largest
57.53%


Current
303.57


52W high (September 15, 2020)
323.36


52W low (March 19, 2020)
199.28

Source: KRX



KOSPI 200 Rebalancing Projection: Safe Bets & Those in Grey Area

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

MSCI Emerging Markets Index / Technical Analysis

The MSCI EM index (local currency) remains in an uptrend and is testing all-time highs set in January 2018 near 65,800; as long as the index is above 60,000 we are constructive from a price perspective.  China (CSI 300, MSCI China) continues to offer many attractive setups and accounts for the vast majority of today’s recommendations. Taiwan (TAIEX) continues to be worthy of an overweight within the EM universe, while South Korea (KOSPI) and India (SENSEX) display improving price and RS trends -- add exposure.

The MSCI EM index (local currency) remains in an uptrend and is testing all-time highs set in January 2018 near 65,800; as long as the index is above 60,000 we are constructive from a price perspective.  China (CSI 300, MSCI China) continues to offer many attractive setups and accounts for the vast majority of today’s recommendations. Taiwan (TAIEX) continues to be worthy of an overweight within the EM universe, while South Korea (KOSPI) and India (SENSEX) display improving price and RS trends -- add exposure.

South Korea

Doosan Fuel Cell Co. Ltd. produces and sells cell products. The Company develops and sells residential used compact fuel cells and other products. Doosan Fuel Cell markets its products worldwide.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Doosan Fuel Cell (336260 KS)

KOSPI200 Index Rebalance Preview: Review Period Nearly Complete, Nine (Or Ten) Possible Changes

The KOSPI200 index review will be announced in the next 4 weeks. We see 9 inclusions/ exclusions and significant volume to sell on the deletions....

Brian Freitas

Doosan Fuelcell: Block Deals Outcome on Rights Offer

???

Sanghyun Park

Doosan Fuel Cell Big Block Deal Placement

It was announced after the market close today that Doosan Fuel Cell Co Ltd (336260 KS) will conduct a big block deal of 10.927 million shares....

Douglas Kim

KOSPI 200 Rebalancing Projection: Safe Bets & Those in Grey Area

???

Sanghyun Park

Remain Overweight EM Relative To EAFE

The MSCI EM index (local currency) remains in an uptrend and is testing all-time highs set in January 2018 near 65,800; as long as the index is...

Vermilion Research

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)